Notes: Chapter 1

1. As the suggested further reading indicates, this light-hearted account of the economic basis of intellectual property conceals considerable complexity. On the other hand, the
core argument is presented here—and a compelling argument it is.

2. See Jack Hirshleifer, “The Private and Social Value of Information and the Reward to Inventive Activity,” American Economic Review 61 (1971): 561–574.

3. Unfortunately, the reality turns out to be less rosy. James Bessen, “Patents and the Diffusion of Technical Information,”Economics Letters 86 (2005): 122: “[S]urvey evidence suggests that firms do not place much value on the disclosed information. Moreover, those firms that do read patents do not use them primarily as a source of information on technology. Instead, they use them for other purposes, such as keeping track of competitors or checking for infringement. There are, in fact, sound theoretical reasons why the disclosed information may not be very valuable. [Fritz] Machlup and [Edith] Penrose report that the argument about diffusion is an old one, popular since the mid-19th century. They also point out that, at least through the 1950s, economists have been skeptical about this argument. The problem, also recognized in the mid-19th century, is that ‘only unconcealable inventions are patented,’ so patents reveal little that could not be otherwise learned. On the other hand, ‘concealable inventions remain concealed.’ ” [Citations omitted.]

4. Felix S. Cohen, “Transcendental Nonsense and the Functional Approach,” Columbia Law Review 35 (1935): 817.

5. For contrasting views of the sequence of events, see John Feather, “Publishers and Politicians: The Remaking of the Law of Copyright in Britain 1775–1842,” pt. 2, “The Rights of Authors,”Publishing History 25 (1989): 45–72; Mark Rose, Authors and Owners: The Invention of Copyright (Cambridge, Mass.: Harvard University Press, 1993).

6. Tim O’Reilly points out that there are 32 million titles in the Online Computer Library Center’s “WorldCat” catalogue—this is a reasonable proxy for the number of books in U.S. libraries. Nielsen’s Bookscan shows that 1.2 million books sold at least one copy in 2005. This yields a ratio of books commercially available to books ever published of about 4 percent. But of those 1.2 million books, many are in the public domain—think of Shakespeare, Dickens, Austen, Melville, Kipling. Thus the percentage of books that are under copyright and commercially available may actually be considerably lower than 4 percent. See For a lucid account of the statistics in the context of the Google Book Search Project, see

7. See Barbara Ringer, “Study Number 31: Renewal of Copyright,” reprinted in U.S. Senate Committee on the Judiciary, Subcommittee on Patents, Trademarks, and Copyrights,Copyright Law Revision, 86th Cong., 1st Sess., Committee Print (1960), 187. See also HR Rep. 94-1476 (1976), 136; William M. Landes and Richard A. Posner, The Economic Structure of Intellectual Property Law (Cambridge, Mass.: Belknap Press, 2003), 210–212.

8. Details of the orphan works problem can be found in the proposals presented to the copyright office by the Center for the Study of the Public Domain; Orphan Works: Analysis and Proposal: Submission to the Copyright Office—March 2005, available at, andAccess to Orphan Films: Submission
to the Copyright Office—March 2005
, available at Two recent bills, in the Senate and House, respectively, attempt to address the orphan works problems. The Shawn Bentley Orphan Works Act of 2008, S 2913, 110th Cong. (2008), would add a new section to the Copyright Act limiting remedies for infringement of orphan works and requiring the establishment of a database of pictorial, graphic, and sculptural works. The House bill, The Orphan Works Act of 2008, HR 5889, 110th Cong. (2008), is similar but not identical. While these bills are a good start, the eventual remedy will need to be more sweeping.

9. Bruce Sterling, Heavy Weather (New York: Bantam, 1994): 73